The registration of a real estate acquisition in the land register is the legal transfer to the new owner. This has to take place as soon as possible after the purchase. In the case of a home loan, two types of land register entry occur: The entry of the right of ownership and that of the lien of the bank. Both cause costs.
The most important facts in brief
- Only the entry in the land register makes the purchaser of a property also legally the owner.
- The land register entry of the right of ownership costs 1.1 % of the purchase price.
- The land register entry of the lien costs 1.2 % of the mortgage.
- The duration from application to land register entry varies from municipality to municipality and can be between two weeks and several months.
What is the land register?
The land register is a public directory of all properties assigned to a district and their rights and encumbrances. It is available in the respective district court. Everybody can have a look. In the meantime, it is also possible to order land register excerpts online or to commission a lawyer or notary to do so.
Why do you need a land register entry?
Only the registration of the ownership in the land register makes the buyer also legally the owner of the property. The sales contract alone and even the handover are not enough. In addition, the land registry entry contains important information regarding the land concerned.
What does the land register entry cost??
You pay for the entry and the registration fee of 1.1% of the purchase price and 1.2% of the mortgage.
The land register entry is calculated from the purchase price. The costs amount to 1.1 % of the contractually agreed price. The notary, if he also does the fiduciary processing, invoices the registration fee together with the purchase price and land transfer tax and takes care of the timely payment of the fee.
In the case of financing by means of a loan, a second entry is added: the bank's lien. This registration costs 1.2% of the mortgage. In addition, there are entry fees of € 44,-. Who does not make the land register registration electronically, pays € 62, – for the input.
How to make an entry in the land register?
Prerequisite for the land register entry is the certification of the purchase contract or the signatures of all contracting parties, respectively. Only in this way the contract of sale becomes the deed needed for the registration. This is done by a notary.
Often the notary is also the trustee (sometimes this is done by a lawyer). Among other things, the trustee takes care of the land register entry – both of the ownership right and the lien.
However, it is also possible to apply directly to the district court for registration in the land register. For this purpose, a land register application is made, which must contain the following data and documents in particular:
- Exact specification of the property
- First name and surname
- Date of birth
- Residence
- Proof of citizenship or proof of the buyer's EU nationality
- Purchase contract with notarized signature of all contracting parties
- Certificate of the building authority or an expert opinion on the existence of independent condominium objects
- Useful value appraisal by a civil engineer or a notary public. by generally sworn and court-certified experts or the legally binding decision on the usufructuary value determination by the arbitration board or the court
How long does a land register registration take??
There is no general information on how long it takes to register ownership and lien in the land register. It depends very much on the application frequency at the responsible district court, how fast this can handle the registrations.
From the application by the notary to the registration sometimes only two weeks pass, in another case it can take several months. It varies greatly from municipality to municipality and also depends on the filing date.
In any case, the registration fee is not due until the actual registration, although this rarely matters to the buyer, since the money is in the account of the trustee (notary or lawyer) anyway.
Special features of the land register registration
In most cases, land register registrations follow the same scheme and are quite uniform.
However, there are also special cases:
Simultaneous mortgage
A special feature of the land register registration is the simultaneous mortgage. This actually says nothing other than that more than one property is securing the loan. This increases the credit rating and creates better conditions. In some cases, it is even the only way for the borrower to get a loan at all – for example, if the equity ratio is very low.
The simultaneous mortgage is a security in rem, which does not have to be personal either. So the borrower does not have to dispose of the second property himself, someone else can be liable for the financing with his property. The costs are the same as for the simple mortgage and amount to 1.2 % of the lien. In addition, there is an additional fee of about 20%.
As a result, with the simultaneous mortgage, one is then usually at 1.44% of the loan amount. Unless the two properties are mortgaged one after the other, rather than at the same time. Then incur 1.32% to 1.56% for the simultaneous mortgage. The 20 % ancillary fee security comes into play here again.
Bail bond
A security deposit bond is a type of note or special entry on a property's lien. It is common for real estate whose financing by the bank is far below the market value of the property. The bond marks the property as a special security of the bank when it comes to refinancing their loan.
As a result, the property is no longer just the collateral that the borrower brings forward, but also the collateral that the bank offers to its creditors. Deposit bands are common and nothing unusual. A borrower who finances at least 40% of purchase price plus incidental charges from his own funds and the rest by means of credit may receive a letter from the bank noting that a security bond has been applied. For the borrower there are neither costs nor troubles.
The only exception: in the event of bankruptcy of the bank, the borrower can not settle its claims with the mortgage, because the liens provided with bail bond do not fall into the bankruptcy estate. The deposit band can also be rejected. However, it is questionable whether you will then still be able to get correspondingly good financing offers.
For your information: savings deposits are up to 100.000 euros government-backed and will be replaced in the event of bankruptcy. Open loans can be offset against higher savings deposits. Say, who has savings deposits in the amount of 200.000 and has an outstanding loan with the same institution in the amount of 100.000 euros, loses nothing. However, if a deposit band is attached to this loan, these 100.000 euros of residual debt not eligible.
SUMMARY:
- The land register is a public register that lists all properties and states the associated rights and encumbrances.
- Only the registration of the property right makes the buyer also legally the owner of the property.
- For the registration in the land register it is necessary to certify the signatures of all parties at the time of signing the contract.
- Usually, the release of encumbrances is also executed up front, unless otherwise agreed upon.
- The land registration costs 1.1% of the purchase price.
- The registration of the lien adds another 1.2% to the loan amount.
- The length of time depends greatly on the volume of traffic in the district court and can range from two weeks to several months.